Boom in Construction Could Help and Hinder Trucking in the Long Run

A new survey of 900 construction firms across 48 states and the District of Columbia by the Associated General Contractors of America (AGC) finds that 80% of them plan to expand their payrolls this year while only 7% expect to reduce headcounts – an indication, the trade group believes, that an increase in construction activity lays just around the economic bend. “Contractors are extremely optimistic about the outlook for 2015,” said Stephen Sandherr, the association’s CEO, said this week. “Indeed, if their predictions prove true, industry employment could expand this year by the most in a decade.” Yet this survey, conducted as part of Ready to Hire Again: The 2015 Construction Industry Hiring and Business Outlook, also indicated a variety of challenges face the construction industry, too, especially worker shortages and regulatory burdens. [You can click here to read the survey results directly.] Of particular concern for trucking is that the construction industry pulls from the same labor pool, with many potential driver candidates often opting for the building trade if work and better pay is available. “Despite the overall optimism, some challenges remain for the industry,” added Ken Simonson, the association’s chief economist. “In particular, as construction firms continue to expand, they will continue to have a difficult time finding enough skilled construction workers.” Among respondents who are trying to hire workers, 87% said they are having a hard time filling key professional and craft worker positions. In particular, 76% of contractors hiring right now said they are having a hard time finding qualified craft workers, while 62% say the same about professional positions such as project managers, supervisors and estimators. Simonson noted that as the supply of construction workers tightens, compensation levels appear to be rising, with 51% of firms increasing base pay rates to retain construction professionals and 465 doing the same to retain skilled craft workers. That might force trucking firms to boost driver wages more – something already occurring across much of the industry. A lot of that activity should generate more freight volumes for trucking, and when combined with low fuel prices, should offer a nice bottom-line boost as well. Let’s see how all this pans out as the 2015 moves along. (FleetOwner)